Special Civil Application No. 20496 of 2015. Case: Purnima Advertising Agency Pvt. Ltd. and Ors. Vs Union of India and Ors.. High Court of Gujarat (India)
| Case Number | Special Civil Application No. 20496 of 2015 |
| Counsel | For Appellant: Paresh M. Dave, Advocate and For Respondents: Shri Gaurang H. Bhatt, Advocate |
| Judges | Harsha Devani and G. R. Udhwani, JJ. |
| Issue | Central Excise Act, 1944 - Sections 11, 11B, 11B(1), 11B(2), 11BB; Constitution of India - Article 226 |
| Citation | 2016 (42) STR 785 (Guj) |
| Judgement Date | March 18, 2016 |
| Court | High Court of Gujarat (India) |
Judgment:
Harsha Devani, J.
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This petition under Article 226 of the Constitution of India is directed against the order dated 06.11.2015 passed by the Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad (hereinafter referred to as "the Tribunal") and seeks a direction to the second and third respondents to pay to the petitioner Company interest of Rs. 3,07,423/- on delayed refund of Rs. 28,94,776/- for the period from 03.06.2008 to 10.03.2010. The petitioner also seeks a declaration that it is entitled to interest at appropriate rate (that may be fixed by this court) for delay in paying interest of Rs. 3,07,423/- for the period from 24.04.2015 till actual payment and also for paying interest on interest of Rs. 5,40,094/- for the period from 10.03.2010 to 10.11.2010.
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The petitioner Company is engaged in providing advertising services, which is taxable service under the provisions of the Finance Act, 1994 (hereinafter referred to as "the Act") as amended from time to time and is discharging service tax liability under the said Act. The petitioner company has been registered as an assessee and is a service provider with the Service Tax Department. The petitioner Company paid excess service tax to the tune of Rs. 42,68,686/- for the advertising services provided by them during April 2003 to November 2004. On 24.01.2005, the petitioner Company filed a refund claim of Rs. 42,68,686/- with the third respondent - Assistant Commissioner of Service Tax, Division-1, Ahmedabad. A show cause notice dated 21st March, 2005 came to be issued to the petitioner Company proposing to reject the refund claim on the grounds of time-bar and unjust enrichment. The Assistant Commissioner of Service Tax passed an order in-original dated 31.01.2008 rejecting the entire refund claim. The petitioner Company went in appeal before the Commissioner (Appeals), Ahmedabad. By an order dated 03.06.2008, the Commissioner (Appeals) held that the refund claim to the extent of Rs. 28,94,776/- was not hit by limitation, and therefore, it was maintainable to that extent, but the amount could not be paid to the petitioner Company because the claim was hit by unjust enrichment and accordingly, he directed that the amount of refund of Rs. 28,94,776/- be transferred to the Consumer Welfare Fund. The petitioner carried the matter in further appeal before the Tribunal. Revenue also challenged the order of Commissioner (Appeals) before the Tribunal on the ground that the refund claim was time-barred and that the Commissioner (Appeals) ought not to have allowed the same. By a common order dated 06.11.2009, the Tribunal decided both the appeals whereby, it dismissed the appeal preferred by the revenue and partly allowed the appeal filed by the petitioner Company. The Tribunal, however, held that the claim to the extent of Rs. 13,73,910/- held to be time-barred by the Commissioner (Appeals) was not validated because the same was not accepted to be time-barred. Thus, the petitioner Company was held to be entitled to refund of Rs. 28,94,776/- by virtue of the order dated 06.11.2009.
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Pursuant to the above order of the Tribunal, the third respondent made a fresh order being order in-original dated 10.03.2010 sanctioning refund of Rs. 28,94,776/-. However, despite the fact that there was a long delay in paying the refund to the petitioner Company, interest as provided under section 11BB of the Central Excise Act, 1944 as made applicable to matters under the Finance Act, 1944 also, was not paid by the third respondent. The petitioner, therefore, preferred an appeal before the Commissioner (Appeals) challenging the order dated 10.03.2010 to the extent the interest on delayed refund was not paid. It was the case of the petitioner Company that the refund claim was lodged on 24.01.2005, whereas such claim was sanctioned and paid on 10.03.2010 and therefore, the respondents were liable to pay interest under section 11BB of the Central Excise Act for the period commencing three...
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